Publicis Groupe’s just-announced acquisition of search marketing firm Performics from Google should alleviate some concerns about conflicts of interest among the search giant’s properties. Publicis expects the ad service and platform to complement several of its existing agency operations, particularly its performance-based outfits such as mobile firm Phonevalley. The purchase also could help the company expand its smaller business clientele in emerging overseas markets.
The newly-acquired firm will be housed within the holding company’s recently-launched VivaKi Nerve Center, a division designed to foster alignment among agency assets Denuo, Digitas, Starcom-MediaVest, and Zenith-Optimedia, and its performance marketing properties, which include Click2Sales, Phonevalley, and Webformance.
Although each of VivaKi’s operations has some form of SEM capabilities, explained VivaKi Nerve Center President Curt Hecht, technology is key to the decision to unload Performics from Google-owned DoubleClick.
“Their heritage is really technology and tools,” said Hecht. “The charter for the Nerve Center is to bring technology and tools to brands…. Performics can bring those technologies and tools to help scale across the brands.” Performics will report to Hecht.
While Publicis and its agencies are known for their brand advertising and marketing work, their clients are demanding performance-based offerings more and more. “Increasingly, they’re asking us to go into acquisition and response-based media,” Hecht explained.
When Google bought ad management firm DoubleClick last year, search engine marketers were skeptical about potential conflicts of interest. The concern was that the biggest seller of search advertising now owned a firm that assisted marketers in determining how and how much to spend on search ads.
In addition to augmenting its current SEM services with 200 new employees, Performics could also help Publicis enter otherwise out-of-reach markets such as local retailers, according to Hecht. Serving smaller, local advertisers is something the big agencies under the Publicis umbrella haven’t done much of in the past.
“I think for agencies in general it can be a little bit tougher to work with the smaller markets,” suggested Hecht. But as these types of businesses adopt search and other performance-marketing tactics, the Performics buy should help the company better serve smaller clients.
It could also give Publicis a leg-up in emerging global markets, he added. “What you see us developing is really a global suite of performance-based [offerings],” he said. “Wouldn’t that process be interesting in India or Russia, where we’re trying to extend our global reach with search?”
Performics has staff in Beijing, Chicago, Hamburg, London, New York, San Francisco, Singapore, and Sydney. Terms of the deal were not disclosed; Publicis expects it to close in Q3 of this year.
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